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Archive for the 'Negative Messages' Category

Between network security breaches and random corporate blunders, it's been a rough few months for GM, Target, Neiman Marcus, Adobe, Michaels, Lululemon, SeaWorld, US Airways, Yahoo, and about half the population of the Internet, thanks to the Heartbleed glitch.

Their grief is our good fortune, however—at least in terms of providing discussion material for business communication. CommPro.biz offers a wide range of commentary and analysis by corporate communication professionals, and the site's crisis communication section offers some great articles to discuss with your students.

The sections on internal/employee communication and corporate social responsibility also have a variety of pieces you might find useful in your classes.

Hailo is a popular taxi-hailing service operating in London, New York, and other major cities. With a quick tap on a smartphone app, passengers can hail any Hailo-registered cab in the area, without waving in the street or hunting for a place where taxis are likely to be found.

The system does have a potential downside for drivers, however. They have to spend time driving to the passenger's location and waiting up to five minutes once they arrive—time during which they aren't earning any income. If drivers suspect that a potential passenger will want only a short ride, they are more likely not to respond to the request because the short ride won't compensate for the time they have to invest.

This phenomenon can be troublesome for the system as a whole during peak hours, when more passengers are trying to use the system. To keep its app users happy, Hailo wants as many drivers as possible to participate during peak times. To encourage participation, it guarantees drivers a minimum amount of revenue for every Hailo rider they pick up.

The Hailo service in London recently raised its peak-time minimum fare and announced the increase in an email message to app users. The message is a model of how to present negative news in a positive way. It is also a great example of using the indirect approach for organizing a message.

We've included the message on a set of annotated PowerPoint slides so you can share it with your class.

Judging from the vociferous comments in the social media atmosphere, one might think that Netflix's decision to split itself in two or Bank of America's introduction of a debit card fee were some of the worst horrors ever visited upon the human race. BofA isn't likely to reverse its decision, even if thousands of people really do drop their banks for a credit union on Bank Transfer Day. However, the online uproar certainly prompted Netflix to first apologize for not doing a better job of explaining its decision—and then to reverse the decision entirely. [Update 11-1-11: In response to an overwhelming number of complaints, BofA just announced it is scrapping plans to introduce the debit card fee. The crowd has spoken!]

When we began covering social media in our textbooks some years ago, it was soon apparent that these new tools were much more than tools: They were disruptive technologies that were going to fundamentally alter the relationships between companies and their stakeholders. Sure enough, consumers have more power to influence business than ever before, and they aren't always yielding that power with a gentle touch and a kind word.

In addition to aggregating consumer voices, social media can amplify consumer moods and emotions. Unpopular decisions that might have once caused little more than isolated, ineffectual grumbling can now spark organized protests that tarnish brands, deplete goodwill, and even cause changes in corporate strategy.

The message to companies: You better get it right, you better get it right the first time, and you better explain yourself before, during, and after every change you make. Effective communication has never been as important as it is in this volatile new world of business. And even if you're doing something that makes strategic or financial sense, prepare yourself for a negative response.

Consumer-review websites such as Yelp can be a boon or a bane to local businesses. They can help businesses with little or no advertising budget get exposure through positive word-of-mouth, but they can damage businesses when unhappy customers use the Internet to vent their frustrations.

When a bad review is justified, it can alert potential customers to consider other options and help the company improve its operations. However, an unfair negative review helps nobody. It can divert potential customers away from company that might well meet their needs, and it can inflict temporary or even lasting damage on a company that doesn't deserve it.

Unfair negative reviews can come in a variety of flavors, such as when consumers are at least partially at fault (e.g., ignoring product descriptions on an e-commerce site, ordering a product that clearly doesn't meet their needs, and then criticizing it), when a minor glitch in service is blown out of proportion, or when individuals use review websites as their personal creative-writing platforms and are more interested in being funny or snarky rather than honest and helpful.

Fortunately for unfairly maligned business owners, Yelp, TripAdvisor, and other sites give them the chance to respond. However, these scenarios do present one of the more difficult writing challenges a business owner is likely to face. Unlike an apology for poor service, for example, where the owner can express regret in a straightforward manner and perhaps offer some form of compensation, the unfair review requires a great deal of finesse. The owner's response needs to correct the misinformation without engaging the reviewer in a public argument. Moreover, maintaining a calm, professional tone can be a challenge when one's reputation and livelihood have been subjected to unfair insults.

Putting your students in the roles of maligned business owners can be great practice for writing clearly while keeping one's emotions under control. Have each student find a harsh negative review on Yelp or TripAdvisor and imagine that he or she is the owner of the business in question. The student should assume that the information in the review is factually incorrect and write a hypothetical response that corrects the misinformation without "taking the bait" of the emotional attack. Encourage students to really imagine just how upset hardworking business owners would be after seeing their names dragged through the mud. By role playing scenarios like this, students will get practice at keeping their emotions under control when they are unfairly criticized in any professional setting.

Situations that involve negative news are sometimes opportunities in disguise. After Toyota had issued several vehicle recalls and been subjected to quite a bit of media scrutiny regarding product quality, the company’s chief quality officer took the opportunity to discuss the meaning of a product recall and explain how Toyota was responding to the situation.We've annotated a copy of the news release that you can download from SlideShare or from the link below.

Want to make an unpleasant situation even worse? Spring the news on people with no warning.

Chargify, which provides securing billing solutions for small to midsized e-commerce companies, charges its clients flat monthly fees based on the number of customers they have. This tiered pricing plan keeps costs low for e-commerce startups that still have few revenue-generating customers.

Until recently, the lowest tier in Chargify’s pricing plan had an extremely attractive price point—it was free. The idea behind the free tier was to attract e-commerce companies still in their startup phase, and as they grew, they would grow into the higher tiers and become paying clients. However, Chargify discovered that many companies in the free tier grew very slowly, if they grew at all, and Chargify wound up supporting a lot of users that weren’t bringing in any revenue.

In order to pull in enough money to deliver the dependable, sustainable services that its clients needed, Chargify realized it needed to raise prices, and that included charging lowest-tier clients for the first time. The company announced its new pricing structure and immediately came under attack from many of its clients—for the price increases themselves, for the lack of any advance notice, and for Chargify’s refusal to “grandfather” existing customers under their original pricing plans. Some called the company “greedy” or “stupid,” and a few went so far as to accuse it of bait-and-switch tactics.

As bloggers and commenters across the Internet piled on, the technology news site TechCrunch summed up with the situation with an article that began, “It’s been a rough day for Chargify . . .” After spending two long days responding to criticisms on Twitter, industry blogs, and other venues, co-founder David Hauser wrote an unusually frank blog post titled “How to Break the Trust of Your Customers in Just One Day: Lessons Learned from a Major Mistake.” He said the company made “a massive mistake” in the way it handled the changes to its pricing model. By failing to alert customers well in advance of the change, he continued, Chargify “broke a trust that we had developed with our customers over a long period of time, and will take much to repair. We should have communicated our need and desire to remove free plans and provided more information about how this would happen, and over a period of time leading up to the change.”

The services Chargify provides take money to deliver, and the price increases were necessary, but everyone involved agrees that the situation was not handled well. Hauser and his team will continue to learn new lessons as they expand Chargify, but you can bet they won’t ever initiate a price increase without giving their customers plenty of warning. (By the way, if you teach Introduction to Business, this story has a number of interesting angles to discuss in class, including the difficulty of validating a business model before it goes live, the financial imperative to jettison unprofitable customers, and the pluses and minuses of the freemium pricing strategy.)

We can only assume that BP’s website has been hacked. As of October 7, 2010, the “Contacts” page in the “Gulf of Mexico Response” section of BP’s website links to a parody Twitter account, @Oil_Spill_2010. The downloadable PDF (see link above) has current captures of the BP webpage, the parody Twitter account, and BP’s real Twitter account.

This is not the first Twitter parody account associated with the spill, either. Another spoof account, @BPGlobalPR, currently has 188,000 followers—ten times more than BP’s own Twitter account.

Aside from the matter of tighter website security to prevent hacked links, this situation highlights the challenge of responding to negative information in a social media environment. Here are some related questions to discuss with your students:

Are parody efforts an effective form of protest communication?

Are such parodies ethical from the perspective of all stakeholders?

In general, how should a company respond to social media attacks on its reputation, particularly in the case of a Twitter account such as @BPGlobalPR, which has a much larger following than the company’s own account?

Should BP engage @BPGlobalPR directly (by having a company representative respond to its tweets) or indirectly (relying on its own PR efforts to counter the negative information)?

How should a company respond if someone is spreading demonstrably false information about its products, operations, or executives?